Still Want To Bet Against Elon?
Between October 2019 and January 2020 Telsa’s stock price has doubled. It is now worth more than Ford and GM combined. That meteoric rise has lead to many skeptics to point to the stock and scream BUBBLE!
Very few analysts do 5 and 10 year projections. A year ago, I would read Tesla valuations that excluded the potential future contribution of the planned giga factory in China. The China plant was hypothetical at best and therefore could not be assessed.
Analysts do quarterly assessments based on historical price/earnings data and very short term projections. One exception is ARK Industries. ARK does 5 year modeling. ARK industries 5 year valuation for Tesla has gone from $4,000/share to $6,000/share. (They will be releasing another updated valuation in a few weeks). ARK’s 5 year valuation is based on the 3 year lead that Tesla has in EV technology. This lead and expanding production capabilities are such that in 5 years, Tesla is projected to maintain a 30% share of global EV sales. EV sales are projected to be 37 million units annually in 5 years (33% of the total auto market).
To state this yet again, the IEA’s Sustainable Development scenario projects that in just 20 years 50% of all the vehicles on the roads around the world are zero emissions and these will be almost entirely EVs. If we are to avoid frying the planet, the transition to EV must happen very quickly and a 5 year time frame to 33% new vehicle sales is required.
Tesla also has a massive lead in autonomy and this will be a major additive driver of value. IIn 5 years, ARK’s model projects that Tesla will be a trillion dollar company (among the highest value companies on earth).
Still want to bet against Elon?